Code Switch

6:04 pm

Sat May 25, 2013

Job Searching While Black: What's Behind The Unemployment Gap?

A man interviews for a job in Detroit. The unemployment rate for black Americans in Michigan was 18.7 percent in 2012, more that twice the rate for whites in the state.

Paul SancyaAP

In the classic American story, opportunity is always in front of you. You finish school, find a job, buy a home and start a family; it's a rosy dreamscape.

But that world is one-dimensional. Income inequality is just about as American as baseball and apple pie. And though the economy has improved in the past few years, the unemployment rate for black Americans, now 13.2 percent, is about double that for white Americans.

Persistent unemployment and difficulty getting a job cumulatively impact the so-called wealth gap. Wealth or net worth is defined as a person's total assets — such as bank and retirement accounts, stocks and home value — minus debt. It's what families lean on in a downturn.

"The wealth gap is really where history shows up in your wallet," says Heather McGhee, vice president of policy and outreach at the public policy group Demos. McGhee has spent a lot of time looking at these numbers and what it means for families.

While student loan debt is at record numbers across the board, McGhee says, black college graduates are twice as likely to have student loan debt as their white counterparts, who often use their statistically higher wealth to pay for college and take on less debt.

"It means a difference between the African-American graduate coming out, graduating into a recession ... [and] having to start paying down her student loans," McGhee tells NPR's Jacki Lyden. "Whereas her white classmate actually doesn't and is able to get a job faster."

While it is hard for anyone to educate or work their way into the middle class these days, McGhee says, it is twice as hard for blacks.

She says an uptick in GDP growth doesn't mean that working- and middle-class families are struggling to get by any less. She advocates for something more substantial, like going back to a debt-free college system.

"We created the greatest middle class the world has ever seen ... but by saying, 'We as a country are investing in you,' " she says. "That's what we have to do for today's young generation that is more diverse and is less likely to come from inherited wealth."

Tough Times In Great Lakes State

Michigan has the highest rate of unemployment among black Americans in the country. Nearly 1 in 5 blacks there — 18.7 percent — is out of work.

That's about more than twice the rate for whites in the state, according to the Economic Policy Institute.

On a recent day, 58-year-old Joan Knox was at the Urban League of Detroit, taking part in the group's Mature Worker Program. There she gets computer training while earning a small wage.

Even that small wage has been a godsend for Knox, who has been out of full-time work for more than a decade. At one time she ran her own small business, providing housekeeping and catering services. Then the auto industry collapsed and factories started laying off workers and closing.

"I lost a lot of my clients — the majority — so there went my business because they couldn't afford me," Knox says.

Since then, Knox has subsisted on some small jobs here and there, mostly part-time work. Even when she landed a job at one of the local stadiums, she says, she never got more than 20 hours a week.

"It was quite frustrating," she says.

Knox says she gained a lot of weight and her hair started falling out because she was worried she was "going to be on the streets or knocking on the doors of the shelters."

The mature worker program ends soon, and Knox, who lives with her sister, still desperately needs a job. She'd like to be an executive assistant so she can apply her skills.

"I'm great at multitasking [and] I'm great at making people feel good about themselves," she says. "You know I've gone through it. I didn't know I had it in me, so now I'm finding it's something I can market."

Knox has been trying to spread the word to make that happen. Even if she's just chatting with people on a bus, she lets them know she's looking for a job, what she can do and gives them her contact information in the hope she'll hear from them.

"Each time a door gets closed or the phone never rings or you never get a response back to an email, it's quite frustrating," she says. "And emotionally, it does sort of tear you down and keep you down a bit."

Out Of The Network

Even a hustle like Joan Knox's may not be enough to make up the enduring unemployment gap for black Americans.

"Whites disproportionally hold the best jobs, the jobs with the highest incomes, and we still live in a quite segregated society," says Rutgers Business School professor Nancy DiTomaso. She says deep-seated and unconscious favoritism plays a strong role.

In research for her book The American Non-Dilemma: Racial Inequality Without Racism, DiTomaso began by interviewing several hundred white people from across the country about their job histories.

She found that about 70 percent of the jobs they had held over their lives were obtained thanks to some kind of inside edge or outside help, like a friend tipping them off to an open position or putting in a good word for them.

"It raises questions about people who may not be part of those kinds of networks," DiTomaso tells Lyden. "So when there are opportunities to pass along they are passed along primarily to whites."

DiTomaso says that one of the consequences of people finding a job this way is that they do not think of themselves as participating or contributing to the reproduction of racial inequality. Many of those whom she interviewed, despite receiving significant help in their careers, felt they'd gotten where they were from hard work alone.

"It does seem that there is a public policy issue to be addressed when people are passing along jobs that really don't belong to them," she says.

The Economic Policy Institute finds that the black unemployment rate is projected to remain higher than the overall rate at least through the end of the year.

Copyright 2014 NPR. To see more, visit http://www.npr.org/.

Transcript

JACKI LYDEN, HOST:

It's WEEKENDS on ALL THINGS CONSIDERED from NPR News. I'm Jacki Lyden.

(SOUNDBITE OF TV SHOW, "LEAVE IT TO BEAVER")

UNIDENTIFIED MAN: "Leave It to Beaver."

LYDEN: In midcentury America, opportunity was always in front of you: finished school, found a job, bought a home, started a family, a rosy dreamscape. But that world was always one dimensional. Income inequality is just about as American as "Leave It to Beaver" ever was. And though in the past few years our economy has improved, the unemployment rate for African-Americans, now at 13.2 percent, is about double what it is for white Americans.

That's our cover story today: African-American unemployment, why it's so high, so persistent and what we can do about it.

(SOUNDBITE OF MUSIC)

LYDEN: We'll start in Michigan, which has the highest rate of African-American unemployment in the country. And for close to one in five African-Americans is out of work, more than 18 percent. That's about two-and-a-half times the rate for whites in the state. Those findings are from the Economic Policy Institute. And Michigan is where we find 58-year-old Joan Knox. We caught up with her at the offices of the Urban League of Detroit.

JOAN KNOX: Number 24 out of the 29.

UNIDENTIFIED WOMAN: Mm-hmm.

KNOX: Because we give one call of the...

UNIDENTIFIED WOMAN: OK.

LYDEN: Today, Knox is in the group's Mature Worker Program. There, she gets computer training while earning a small wage. It's been a godsend for her. She's been out of work for more than a decade. At one time, Joan Knox ran her own small business, providing housekeeping and catering services. Then came the auto industry collapse.

KNOX: Well, when the automobile factory started closing and laying off, I lost a lot of my clients - the majority. So there went my business because they couldn't afford me.

LYDEN: Since then, Knox has subsisted on small gigs here and there.

KNOX: The best I could find would be less than part-time work. I worked at one of our stadiums for a while, but I could never even get 20 hours a week.

LYDEN: And it's taken a toll.

KNOX: I gained a lot of weight and hair falling out because worrying and a lot of times scared if I was going to be on the streets or have to start knocking on the doors of the shelters.

LYDEN: She's now living with her sister. But the Mature Worker Program ends soon and Knox still desperately needs a job. She'd like to be an executive assistant so she can apply her natural skills.

KNOX: I'm great at multitasking. I'm great at making people feel good about themselves. You know, I've gone through it, so I didn't know I had it in me. So now, I'm finding that it's something that I can market.

LYDEN: And Joan Knox is still trying to spread the word to make that happen.

KNOX: You just let anybody know. If you're - if I'm on a bus, I'll talk to somebody and let them know that I'm looking for a job, what I'm able to do. And I'd give them my email address and you hope you hear from someone. But each time a door gets closed or the phone never rings, you never get a response back to an email, it's quite frustrating. And emotionally, it does sort of keep you down and tear you down a little bit. Jesus, don't let me cry.

LYDEN: Joan Knox of Detroit and what it's been like being unemployed for a decade.

The hustle of someone like Joan Knox might not be enough to make up for the enduring unemployment gap for African-Americans.

NANCY DITOMASO: Whites disproportionately hold the best jobs, the jobs with the highest incomes, the jobs that have the most training available.

LYDEN: Nancy DiTomaso, a Rutgers Business School professor, finds that deep-seated in unconscious favoritism plays a strong role in employment and race. She's written a book about it, and she began by interviewing several hundred people from across the country about their job histories - all of them white. And what she found surprised her: 70 percent of the jobs they'd held over the course of their lives were obtained, thanks to some kind of inside edge or outside help, like a friend tipping them off to an open position or putting in a good word.

DITOMASO: Think about 70 percent of jobs are wired in some way or another where it's not quite a fair competition, then it raises questions about people who may not be part of those kinds of networks. And we still live in a quite segregated society. And so when there are opportunities to pass along, they're passed along primarily to other whites.

LYDEN: So what you're describing isn't so much a form of deliberate discrimination as it is people nonetheless, perhaps unconsciously, discriminating.

DITOMASO: Yes. I think that one of the consequences of the fact that people find jobs this way is that they do not think of themselves as participating or contributing to the reproduction of racial inequality, and yet it's both intentional and purposeful in terms of this kind of behavior. And we use that kind of language. People talk about I want to get ahead. We mean to get in front of someone else.

LYDEN: Well, so give me an example of how that plays out in the real world.

DITOMASO: Sure. I talked to once person who, starting in high school, he got a job at a company where one of his friends' fathers worked. And then he got a job from someone who lived at a place on the shore where he would go vacation. And then from there, he got a job with, again, a friend knew someone. Every job he had held throughout his life essentially came about because someone helped him, reached out.

And yet when I talked to this person about, what do you think most contributed to the kind of life you have now, he would say things like because I worked hard. Nobody helped me. Why can't those people do it the way I did? He certainly was not the only one to use that kind of language. He somehow had this notion that he had done it on his own and that other people - and by that, he primarily meant African-Americans - they could go out and find jobs if they just tried hard enough. But, in fact, you know, he had not done it on his own.

LYDEN: Why were so many of the white job holders whom you interviewed unconscious about the fact that they had been helped? You know what I'm thinking of, Nancy, I'm thinking of the movie, "It's a Wonderful Life"...

DITOMASO: Yes, exactly.

(SOUNDBITE OF MOVIE, "IT'S A WONDERFUL LIFE")

HENRY TRAVERS: (as Clarence) Each man's life touches so many other lives.

LYDEN: ...where Jimmy Stewart's giving other people opportunities. They're very conscious of that years later.

DITOMASO: Well, actually, there's another aspect of that movie that I've thought about a great deal because many people have said to me, well, of course, you help your friends. Doesn't everyone do that? And some employers have said, well, of course, we would hire people that are recommended by other people who work here because then we know that they're good employees.

But if you think about "It's a Wonderful Life," Uncle Billy, for example, was hired in that bank because he was the uncle of the person who was running the bank. And, of course, he wasn't the best person for that job and, in fact, had made some critical errors.

(SOUNDBITE OF MOVIE, "IT'S A WONDERFUL LIFE")

THOMAS MITCHELL: (as Uncle Billy Bailey) This is a pickle, George. This is a pickle.

JAMES STEWART: (as George Bailey) All right now, what happened? How did it start?

MITCHELL: (as Uncle Billy Bailey) How does anything like this...

DITOMASO: And so it does seem that there is a public policy issue to be addressed when people are passing along jobs that really don't belong to them.

LYDEN: Does affirmative action help to alleviate the gap that you're describing?

DITOMASO: Of the people that I talked to, I heard about 1,463 jobs. And of those jobs, there were only two examples where there might have been a case where an African-American got a job instead of one of my white interviewees because of affirmative action. So two jobs out of 1,463 would suggest that there really isn't much evidence for reverse discrimination. And my figures, in fact, are quite consistent with other studies of this issue.

LYDEN: Nancy DiTomaso, Rutgers Business School professor and author of the book "The American Non-Dilemma: Racial Inequality Without Racism."

Persistent unemployment and difficulty getting a job impact the so-called wealth gap. That's the cushion made up of savings, stocks and home ownership that families lean on in a downturn. In fact, in 1984, the wealth gap between blacks and whites was less than $100,000 according to a study out of Brandeis University. Since then, it's tripled.

HEATHER MCGHEE: The wealth gap is really where history shows up in your wallet.

LYDEN: That is Heather McGhee. She spent a lot of time looking at the wealth gap and what it means for families.

MCGHEE: Take two similarly situated high school students who are graduating. So you have the student who is an African-American student who grew up on the south side of Chicago. She has excellent grades. She's looking to go to college. And then you have this white student who grew up on the north side of Chicago.

You know that the white student is going to be more likely to have wealth to be able to draw onto. Let's say her parents get to dip into their home equity in order to pay for college tuition fees and books, whereas the African-American student, her family is much less likely to own a home. And so they will have to go into debt.

We know that college graduates who are African-American are twice as likely to have student loan debt. And it means a difference between the African-American graduate coming out, graduating into a recession. What savings does she have to draw on? She has to start paying down her student loans, whereas her white classmate actually doesn't and is able to get a job faster.

LYDEN: We should say, Heather McGhee, that this is not true for all white families. We have also seen an enormous unemployment rate in people under 25 who are graduating with a record amount of student debt into a world of unpaid internships and scarce jobs.

MCGHEE: Absolutely. It is far too hard for anyone to educate or work their way into the middle class. It's just about twice as hard for African-Americans to do so.

LYDEN: Even if the economy were to improve, are the losses so severe as to create basically a permanent underclass in the African-American community?

MCGHEE: So I don't think we can say the economy is improving if working- and middle-class families are still struggling to get by. Just because GDP growth is ticking up does not mean that we've had a fundamental reprioritization of the fates of working- and middle-class families in a way that is conscious of the disparities that exist by race.

For example, we need to go back to a debt-free college system. We created the greatest middle class that the world has ever seen, not by asking the GIs to take out $25,000 in loans, but rather by saying we as a country are investing in you. That's what we have to do for today's young generation that is more diverse and is less likely to come from inherited wealth. So that's one of the many things we could do that would have disproportionate benefit to African-American and Latino young people who are starting out today.

LYDEN: Heather McGhee with the advocacy group Demos.

The Economic Policy Institute finds that the black unemployment rate is projected to remain higher than the overall rate at least through the end of the year. Transcript provided by NPR, Copyright NPR.